When History Rhymes: Staying Calm and Staying the Course
- Apr 11
- 6 min read
Perspective Matters
KEY TAKEWAYS
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Six weeks ago, the United States launched military strikes against Iran. Since then, oil shipments through the Persian Gulf — one of the world’s most critical energy arteries — have been sharply reduced. American service members have been killed. Iranian civilians and much of their country’s leadership have died in significant numbers. And as I write this, there is still no clear plan for how or when this ends.
I’ve been sitting with this before writing about it. As a Certified Financial Planner with more than 40 years of experience, I try not to react to every headline. But this one feels different — and I think you deserve my honest assessment.
THE FOG OF INFORMATION
One of the hardest things about living through this moment is knowing what to believe. Every administration manages information carefully — that’s not new. But what I’m watching now goes beyond careful management. Statements shift day to day. Off-the-cuff comments sometimes seem invented in real time. I’m reminded of the Iraqi Information Minister who became famous in 2003 — nicknamed “Baghdad Bob” — who insisted that Saddam Hussein’s government was fully in control even as American tanks rolled into Baghdad. There is something similar happening today, where official statements and what we can actually observe don’t always line up.
What concerns me more than any single statement, though, is the cumulative effect this has on all of us. When you are bombarded every day with new crises, contradictions, and controversies, eventually your brain starts to shut down. You stop paying close attention. You disengage. This is sometimes called “flooding the zone” — overwhelming people with so much information that it becomes impossible to focus on any one thing. That exhaustion is real, and it takes a toll on our moods, our relationships, and our ability to stay engaged in what is happening around us.
WE'VE SEEN THIS BEFORE
Here is where I want to offer some perspective that I believe is genuinely useful, not just reassuring. For years, I’ve drawn on the work of historians Neil Howe and William Strauss, particularly their books Generations (1991) and The Fourth Turning (1997). Their central idea is this: history doesn’t march forward in a straight line. It moves in cycles, roughly 80 to 100 years long — about the span of a long human life. Within each cycle are four “turnings,” or seasons: a high of prosperity and confidence; a cultural awakening; an unraveling of old institutions; and finally a crisis — what they called the Fourth Turning — when old structures break down and new ones are built to replace them.
They pointed to the American Revolution, the Civil War, and the Great Depression and World War II as examples of previous Fourth Turnings. Each was painful. Each reshaped the country. And from each, something stronger eventually emerged. Writing decades ago, Strauss and Howe predicted that a new crisis era would arrive somewhere around now. I believe we are in it.
I’ve been drawing a parallel for years between today and the early 1900s — specifically the era of Theodore Roosevelt. The decades before TR saw the first great wave of American industrialists: people who took real risks on new technologies and built enormous wealth in return. But by the time Roosevelt took office in 1901, after the assassination of President McKinley, the system had tilted. The original risk-takers had been replaced by a second generation who inherited the power and used it to extract wealth rather than create it — monopolists who squeezed out competitors, fixed prices, and operated above the law.
Roosevelt saw it clearly. He believed deeply in capitalism — but he also believed that capitalism only works when the connection between effort, risk, and reward is real and fair. He brought 44 antitrust suits during his presidency, nearly triple the 18 that the three presidents before him had filed combined. He called his philosophy “progressive conservatism.” He was only partially successful. Wealth continued to concentrate through the 1920s until the system finally broke in 1929. But Roosevelt started something. It took the Great Depression, and then his cousin Franklin Roosevelt, to finish it. What followed — the New Deal, the GI Bill, the postwar expansion of the middle class — became one of the great periods of broadly shared prosperity in American history.
Our founders understood that history moves in these patterns. They designed our government specifically because they knew that people in power would always try to accumulate more of it. They built a system of checks and balances — three branches in constant tension with each other — to protect the whole regardless of who sits in any one chair. That system is being tested right now as severely as it has been in my lifetime. I remain cautiously optimistic that it will hold. But I won’t pretend it won’t take time, or that there won’t be real economic pain along the way.
WHAT THIS MEANS FOR YOUR FINANCES
Here is where I ask for your trust, because this next part may sound counterintuitive: if you have followed a sound financial plan, none of this should significantly change what you do with your money right now.
I know that’s not what the headlines suggest. But reacting to short-term volatility — making investment decisions based on the news of the week — is one of the most reliable ways to hurt yourself financially. The research is overwhelming on this point. Even people who are right most of the time about which direction markets will move typically don’t come out ahead of someone who simply stayed put and kept investing steadily. The stock market can feel like a casino where everyone else is winning and you’re missing out. But when the ride gets rough, what matters is not being forced to sell at the wrong moment.
There are three specific things that make it possible to stay the course through periods like this one:
Keep six months of living expenses in liquid savings. This is money that is completely safe and available to you without touching your investment accounts. It’s your buffer against the unexpected.
Don’t put any money at risk that you know you’ll need within the next two years. Whether that’s a home renovation, a child’s tuition, or any other planned expense — that money belongs somewhere stable, not in the stock market.
Know your “sleep at night” number. This is the amount of money you need to hold safely and accessibly so that you have the emotional strength to leave the rest of your portfolio invested through a downturn. The goal isn’t to eliminate volatility — it’s to make sure you don’t panic and sell at the bottom, which means missing the recovery.
I do think the risk of a recession has increased. Wars and oil supply shocks are classic recession triggers, and this conflict in the Middle East is not going to resolve itself quickly just because the bombs stop falling. But recessions are a normal part of the economic cycle. They are not something to fear — they are something to plan for. If you’ve done that planning, you are already in a far better position than most.
We have been through Fourth Turnings before. They are hard. They demand more of us as citizens and as investors. But history tells us clearly: they end. And what comes after — the spring that follows a long winter — can be remarkable. My job is to help make sure you are still standing, and still invested, when that moment arrives.
READY TO BUILD A PLAN THAT HOLDS UP
I offer financial planning and consulting services separately from investment management. Schedule an Introductory Meeting here if you’d like to talk through your situation — whether you’re wondering if your plan is solid, or you don’t yet have one — I’d welcome the conversation.
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